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WTO Brings Competition to China's Medicine Sector
Chinese medicine distributors have three years to improve their performance before their foreign counterparts can freely enter the market, some experts in the field said here Tuesday.

According to China's commitments to the World Trade Organization, the medicine retail and wholesale business will be opened to foreign investors with no capital or geographical limitations with three years of China's December 2001 WTO entry.

But most of China's medicine-distribution enterprises are uncompetitive. The industry has been controlled by the government for decades and different pharmacies started to merge into chain stores only in the last five years.

Wang Jinxia, chairman of the China Medicine Commercial Association said the industry is crowded with small companies but short of conglomerates.

Yu Mingde, deputy director of the State Economic and Trade Commission's Economic Operations Bureau said that to face the coming challenges, the government will encourage mergers in the sector, and key enterprises will be encouraged to build large enterprise groups.

Yu predicted that 10 conglomerates will emerge in the next five years, each with more than 1,000 outlets and a turnover of 5 billion yuan (604 million US dollars).

(Xinhua News Agency March 13, 2002)

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